Barclays 2011 Annual Report Download - page 171

2011
The tax charge for continuing operations for 2011 was £1,928m (2010:
£1,516m) on profit before tax of £5,879m (2010: £6,065m), representing
an effective tax rate of 32.8% (2010: 25.0%). The effective tax rate reflects
the non-deductible charges for the impairment of the investment in
BlackRock, Inc. of £1,800m (2010: nil), goodwill impairment of £597m
(2010: £243m) and the UK bank levy of £325m (2010: nil).
On 27 February 2012, HMRC announced its intention to implement new
tax legislation, to apply retrospectively from 1 December 2011 that would
result in the £1,130m gains on debt buy-backs being subject to different
tax treatment to that currently allowed under UK tax law. Barclays
voluntarily disclosed the transaction to HMRC and, as at 31 December
2011, held a provision for the potential tax payable in relation to the
transaction. If the legislation had been enacted as at 31 December 2011,
any additional tax charge would not have had a material impact on the
Group’s 2011 results.
Deferred tax assets, which principally relate to Barclays businesses in the
US and Spain, increased by 20% to £3,010m (2010: £2,517) largely due to
improved financial performance in the US supporting additional deferred
tax assets not previously recognised.
2010
The tax charge for continuing operations for 2010 was £1,516m (2009:
£1,074m) representing an effective tax rate of 25% (2009: 23.4%). The
effective tax rate differs from the UK tax rate of 28% (2009: 28%) because
of non-taxable gains and income, different tax rates that are applied to
the profits and losses outside of the UK and deferred tax assets previously
not recognised.
Total tax contribution
In 2011, we made global tax payments of £6,419m (2010: £6,149m), made
up of £3,341m (2010: £3,138m) of taxes borne by Barclays and £3,078m
(2010: £3,011m) of taxes collected from employees and customers on
behalf of governments, £2,866m (2010: £2,776m) being employee
income taxes which arise through Barclays economic activity. Barclays
paid corporate income tax of £1,686m (2010: £1,458m) in 2011 as shown
in the cash flow statement and Note 11 to the financial statements.
The total tax paid to the UK Exchequer in 2011, was £2,891m (2010:
£2,827m), made up of £1,400m (2010: £1,381m) of taxes borne by
Barclays and £1,491m (2010: £1,446m) of taxes collected on behalf of the
government which includes £1,464m (2010: £1,347m) of tax payments
made on behalf of employees.
The table below shows the reconciliation between tax payments shown
above and the tax charge in the income statement:
2011
£m
2010
£m
Tax charge 1,928 1,516
Exclude deferred tax credit/(charge) 701 (123)
Include net current tax liability as at 1 January 450 643
Exclude net current liability as at 31 December (1,023) (450)
Include current tax credit in equity (104) (180)
Include other movements in current tax (266) 52
Corporate income tax paid 1,686 1,458
Other taxes borne by Barclays 1,655 1,680
Total taxes borne by Barclays 3,341 3,138
Other taxes collected by Barclays 3,078 3,011
Total tax paid 6,419 6,149
All current tax and deferred tax reconciling items are disclosed within
Note 11. Other taxes borne by Barclays are included within profit before tax.
a The UK bank levy charge for 2011 was £325m with £183m paid in 2011 and the remaining
balance due in 2012.
Tax borne and tax collected by region
Ta x Tax 2011
Borne Collected Total
1 UK 1,400 1,491 2,891
2 Americas 450 837 1,287
3 Europe (exc UK) 797 250 1,047
4 Africa & Middle East 653 411 1,064
5 Asia Pacific 41 89 130
Total 3,341 3,078 6,419
1
2
3
5
4
£m
1
2
3
5
4
Analysis of tax borne by Barclays
2011
1 Corporate income tax 1,686
2 Employer’s NIC/social security 753
3 Irrecoverable VAT 642
4 UK bank levya 183
5 Other 77
Total 3,341
£m
Barclays PLC Annual Report 2011 www.barclays.com/annualreport 169
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